Has the opening of Amazon fulfillment centers affected demand for disability insurance?

An estimated 17.6% of blue-collar, manufacturing jobs were lost in the United States between 1970 and 2016. These jobs, often union-represented, provided relatively generous pay and benefits, creating a path to the middle class for individuals without a four-year college degree. Evidence suggests the closure of manufacturing facilities and resulting decline in economic opportunity increased demand for disability insurance (SSDI) among blue-collar workers. In recent years, the opening of Amazon Fulfillment Centers (FCs) has accelerated around the country, driving a wave of blue-collar job creation. We estimated the extent to which the opening of FCs affected SSDI application rates, including rates of approvals and denials, using a synthetic control group approach. We found that FC openings were associated with a 1.4% reduction in the SSDI application rate over the subsequent three years, translating to 5,528 fewer applications per year across commuting zones with an FC opening. Our findings are consistent with FC openings improving economic opportunities in local labor markets, though our confidence intervals were wide and included the null.

Figure S1: Estimated difference between log-transformed SSDI (a) application rates, (b) denial rates, and (c) approval rates comparing commuting zones with an FC opening 2011 and later to their synthetic control commuting zones without an FC by year.The synthetic control was a weighted combination of commuting zones without an FC such that the weights minimized the difference in outcome and covariates between FC and non-FC commuting zones in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 3 years after the opening, with 95% confidence intervals.
(a) SSDI Application rates : Estimated difference between log-transformed SSDI application rates comparing commuting zones with an FC opening to their synthetic control commuting zones without an FC by year setting the pooling parameter that determines the relative weights given to the separate SCM and pooled SCMto be a) 0.1 and b) 0.9.The pooling parameter in the primary analysis is 0.27.The synthetic control was a weighted combination of commuting zones without an FC such that the weights minimized the difference in outcome and covariates between FC and non-FC commuting zones in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 3 years after the opening, with 95% confidence intervals.: Estimated difference between log-transformed SSDI current beneficiary rates comparing commuting zones with an FC opening to their synthetic control commuting zones without an FC by year.The synthetic control was a weighted combination of commuting zones without an FC such that the weights minimized the difference in outcome and covariates between FC and non-FC commuting zones in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 7 years after the opening, with 95% confidence intervals.
FigureS2: Estimated difference between log-transformed SSDI application rates comparing commuting zones with an FC opening to their synthetic control commuting zones without an FC by year setting the pooling parameter that determines the relative weights given to the separate SCM and pooled SCMto be a) 0.1 and b) 0.9.The pooling parameter in the primary analysis is 0.27.The synthetic control was a weighted combination of commuting zones without an FC such that the weights minimized the difference in outcome and covariates between FC and non-FC commuting zones in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 3 years after the opening, with 95% confidence intervals.

Figure S3 :Figure S4 :
FigureS3: Placebo test: Estimated difference between log-transformed SSDI application rates comparing commuting zones with an FC opening but with a fake opening date (5 years prior to the true opening date) to their synthetic control commuting zones without an FC by year.The average line to the right of the vertical line represents the effect of an FC opening for the 3 years after the opening, with 95% confidence intervals.
FigureS5: Estimated difference between log-transformed SSDI current beneficiary rates comparing commuting zones with an FC opening to their synthetic control commuting zones without an FC by year.The synthetic control was a weighted combination of commuting zones without an FC such that the weights minimized the difference in outcome and covariates between FC and non-FC commuting zones in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 7 years after the opening, with 95% confidence intervals.

Figure S6 :Figure S8 :
FigureS6: Estimated difference between log-transformed SSDI (a) application rates, (b) denial rates, and (c) allowance rates comparing CZs with an FC opening to their synthetic control CZs that have not yet had an FC opening but will in the future.The synthetic control was a weighted combination of CZs that had not yet opened an FC but would open one in the future such that the weights minimized the difference in outcome and covariates between FC and non-FC-yet CZs in the years preceding an FC opening.The average line to the right of the vertical line represents the effect of an FC opening for the 3 years after the opening, with 95% confidence intervals.(a)SSDI Application rates

Table S1 :
Number of counties with an Amazon Fulfillment Center (FC) in each state that had an FC opening 2006-2017.

Table S2 :
Average treatment effect on the treated (ATT) effect estimates and 95% confidence intervals (CIs) by year cohort.